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If you want to build your wealth over the long term, then every detail counts, because over the long term it’s the small decisions you make upfront that makes a big difference in the long run. Who you invest with, the amount of risk you take and the potential returns you target will determine the benefits you reap in the end.
Our tax-free investments is a flexible investment product geared for growth and tailored for your individual needs and risk tolerance. Our long term growth philosophy is embedded in our investment process and our track record in managing risk is exceptional.
If you are investing for the long term, or if you are already paying income or capital gains tax on your existing investments, then you can invest in our tax-free investments and benefit from tax savings on your investment return.
How does this work?
This account is exempt from tax on all returns
It allows for a maximum contribution of R36 000 per annum and a R500 000 lifetime contribution
A minimum R10 000 lump sum investment per fund is required
If you wish to phase in our investment you can do so with debit orders of as little as R500 per month.
Amounts can be withdrawn at any time. However, if returned, these amounts will be subject to the annual contribution limits
Transfers between different funds within the same account will not be subject to annual contribution limits
You have flexibility with the choice and combination of Melville Douglas Funds you want to invest in
What are the benefits?
No Capital Gains Tax (CGT) - on a switch within this account or on withdrawal.
No tax on dividends - your account will earn the gross dividend, which will be re-invested.
You don’t pay tax on income - all interest and other income will be re-invested tax-free.
No performance fees or initial fees. However, advisers will be able to charge an initial adviser fee agreed with the client.
Service fees - no additional fees will be charged except the annual service fee of the fund selected. This may include a trail fee to the adviser.
Even though the amount of contributions has a lifetime limit, there are no limits on the size that this account can grow to.
Is the tax-free investment suitable for you?
The Melville Douglas Tax-free Investment account typically suits investors who:
Want to receive tax-free investment returns
Want to save over the medium to long term using a convenient investment vehicle
Are looking for investment flexibility and liquidity
Only natural persons who African resident taxpayers may invest in the Melville Douglas tax free investment account, subject to investment requirements. You can also invest for your children younger than 18 years.
You can invest in the following bespoke range of tax-free investments options:
Investors may be aware of National Treasury's drive to reform non-retirement savings in South Africa via tax-free savings accounts. The idea was first introduced in the 2012 Budget Review as a measure to encourage household savings and was again brought to the fore in the 2014 Budget Speech and was launched on the 2nd March 2015.
The primary aim of introducing the tax-free savings product is to encourage individuals to save. The secondary aim is to increase the overall level of savings in the economy. We believe the Tax-Free Savings account is an efficient and powerful way to build up one’s savings pool over the long-term. It is especially potent when combined with a Retirement Annuity, which also gives investors significant tax shelter when saving for retirement.
Yes, provided that the minor has an ID / passport number, a bank account and the investment is made in the minor’s name. Please note that any withdrawals made from the minor’s investment can only be transferred into the minor’s bank account.
The product allows a person to invest a maximum of R30 000 per year, with a maximum lifetime contribution of R500 000. These numbers may be adjusted for inflation. Although investing R30 000 a year may not sound like a substantial amount, the compounding effect - together with the fact that all the income is tax-free, proves significant over time.
Amounts within the account(s) may be withdrawn at any time, like our normal unit trust withdrawals which take 48 hours. All returns from such products will be tax-free in the hands of the individual who owns them.
Please note, any money withdrawn from this account will still be regarded in the annual and lifetime contributions limits, as the investment limit is not based on net contributions, but gross contributions for both annual and life time limits.
No, according to the regulations from National Treasury, these funds need to be kept separate from existing portfolio’s to ensure the tax benefit is correctly managed.
As National Treasury's drive is to encourage new savings in South Africa via tax-free savings accounts, existing investments may not be converted into tax free investment accounts. This means that all tax-free investment accounts must be originated with new contributions from an investor.
To enable a smooth introduction of tax-fee savings, transfers of tax-free savings accounts will initially not be allowed, during the first year of the incentive, until 1 March 2016.
We have a specific unit trust application form called Melville Douglas Unit Trust Tax Free Savings Account indicating what details are required to open a tax-free investment account. The application form is available on our website. A certified copy of the investor’s identity / passport document and proof of residential address is required for FICA purposes. The completed application form and supporting documents can be emailed to STANLIB at [email protected] or faxed to 0867 277 501 or 011 448 6666
Warning – Potential Penalties: Investor must not invest more than R30 000 per annum into any number of Tax Free Savings Account with STANLIB or any other service provider. SARS will on an annual basis monitor your contributions and levy a penalty of 40% (i.e. maximum marginal tax rate) on all amounts exceeding the R30 000 limit.
All Income will be reinvested automatically and will not form part of the R30 000 per annum contribution limit. This is the only way that you can save more than R30 000 and avoid any penalties.
You have reviewed the latest product information on our website (fact sheet) and know the risk and fees associated with your investment choice. You have read and understood the terms and conditions available on our website or upon request.
To invest directly, investors need to download the application form, complete and submit this form and all the associated documents to STANLIB:
STANLIB Collective Investments Limited administer these funds.
You have reviewed the latest product information on our website (fact sheet) and know the risk and fees associated with your investment choice. You have read and understood the terms and conditions available on our website or upon request.
To invest directly, investors need to download the application form, complete and submit this form and all the associated documents to STANLIB:
